July 22, 2008 / 12:57 AM / 9 years ago

Toronto stocks pulled lower by weak resources

TORONTO (Reuters) - The Toronto Stock Exchange's main index finished lower on Tuesday, but trimmed earlier steep losses as a rise by financials offset a drop by resource issues that were hit by tumbling commodity prices.

The resource sectors led the downside and helped take the index down more than 1 percent in the morning, with energy shares hit by a six-week low for oil prices as fears over a tropical storm in the Gulf of Mexico eased.

The energy group fell 2.5 percent, with Canadian Natural Resources (CNQ.TO) down 4.2 percent and EnCana Corp (ECA.TO) off 3.6 percent.

A decline in gold miners helped knock the materials sector down 2.2 percent, as the price of bullion was sharply lower due to weaker oil prices and a stronger U.S. dollar.

But the financial sector offered support, despite falling earlier after U.S. bank Wachovia WB.N posted a record quarterly loss, as investors looked instead to recent better-than-expected results from other U.S. financials.

The S&P/TSX composite index .GSPTSE closed down 46.00 points, or 0.34 percent, at 13,643.19 with half of its 10 main sectors lower.

In the oil patch, Canadian Natural Resources (CNQ.TO) was down C$3.74 at C$85.69 and EnCana slid C$2.86 to C$77.17 amid a further retreat by oil prices. Crude futures fell more than $3 to $127.95 a barrel amid expectations of weakening U.S. demand, while Tropical Storm Dolly was forecast to spare most offshore oil production in the U.S. Gulf.

Among gold producers, Agnico-Eagle Mines (AEM.TO) was off C$3.18, or 4.4 percent, at C$68.65.

Fertilizer company Potash Corp of Saskatchewan (POT.TO) was the biggest decliner by weight, shedding C$5.39, or 2.4 percent, to C$217.60. Workers at three mines owned by Potash voted to give their union a mandate to strike if no progress is made toward a new contract.

Canadian Pacific Railway (CP.TO) fell after the company cut its earnings guidance and reported a decline in quarterly profit amid rising fuel bills and U.S. flooding. CP closed down C$2.42, or 3.6 percent, at C$64.21.

The financial sector rose 2.3 percent, with Canadian Imperial Bank of Commerce (CM.TO) up C$2.37, or 4.1 percent, at C$60.12, while Toronto-Dominion Bank (TD.TO) added C$2.13, or 3.6 percent, to C$61.41.

($1=$1.01 Canadian)

Reporting by Leah Schnurr; editing by Rob Wilson

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